China’s inflation remains steady

11/06/2018

 

Data from the National Bureau of Statistics shows a steady growth of China inflation

 

National Bureau of Statistics (NBS) data showed that China’s consumer price index rose 1.8 percent year-on-year in May. The data also show that consumer price growth continuing to be mild and factory prices of industrial products are slightly edging.

According to NBS statistician Sheng Guoqing, the rise of prices is to given to the carry-over effects, that contributes with 0.4 percentage points.

Instead, food prices edged up by 0.1 percent, resulting in a growth of 0.01 percentage points in the price index. Prices of eggs and vegetables and mutton surged by 24.7 percent, 10 percent and 13.5 percent, respectively.

 

According to Sheng, the price hikes have been largely offset by the decline in fruit and pork prices

 

To fall in price, on the other side, the price of pork and fruit that dropped by 16.7 percent and 2.7 percent. As for non-food prices, instead, the costs of health care products grew by 5.1.

On the other hand, due to worldwide price increases, the price of gasoline and diesel respectably grew by 3.7 percent and 4.1 percent.

According to Liu Xuezhi, a senior researcher with the Bank of Communication, the core CPI excluding food and energy edged down to 1.9 percent in May: “Real inflation has been mild, and there is no obvious inflationary pressure thanks to the performance of the core CPI and weak new price-rising factors”.

 

The producer price index (PPI), a measure of industrial product inflation, rose by 4.1-percent year on year

 

A separate report from the CICC released on Saturday said that the core CPI remained benign in the past few months and, according to the analysts, it could represent an opening to a marginal policy fine-tuning to improve growth expectations.

“China’s CPI will not rebound significantly in the future unless there is a surge in domestic demand. With industrial profits continuing to grow and the quickening of industrial production, industrial product inflation is likely to grow faster” Liu said.

 

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